GST good but tax rate should not exceed 18%: Rahul

Congress Vice President Rahul Gandhi on Monday said that the passage of the Goods and Services Tax (GST) bill is a good step but there should be a cap of 18 per cent on its rate.

Speaking to the reporters after the Lok Sabha passed the bill, Rahul said his party had three basic objections over the bill, which have been addressed but the issue of a limit on the tax rate remains.

“This is a good step, good for the country. We had earlier raised objections on three points in the bill but all of them have been sorted out. Now the issue of a cap of 18 per cent remains. We will see what can be done in this connection,” he said.

The Congress has been demanding a cap of 18 per cent on the GST, with many Congress leaders arguing that a rate higher than that would be inflationary.

However, the government, which may be pitching for a higher tax rate, did not agree with the demand and did not fix a cap.

Finance Minister Arun Jaitley hit out at the Congress, saying the 18 per cent cap on GST was suggested by the party when the bill was passed in the Lok Sabha and later tabled in the Rajya Sabha.

“The concept of a cap on GST was a subsequent development. The cap was not discussed in 2006 and in the successive years. Even when the Congress left (was voted out of power at the Centre) in 2014, nowhere was the cap suggestion made.

“The suggestion on the cap was adopted by the Congress after 2015, when the bill went to the Rajya Sabha,” he said.